Did Generation X Cause the Housing Crisis?

The housing crisis resulted in a great deal of finger pointing. Politicians blamed Wall Street, Wall Street blamed government, and each political party blamed the other political party. What gets lost in the drama of political theater is that real people signed mortgages that could not be afforded. Somewhere in the buck-passing, we are left to wonder what happened and how financial consumers can avoid future foreclosure catastrophes.

Generation X was Most to Blame. The largest percentage of households in foreclosure belonged to those in Generation X—in particular, Gen-Xers who had high average household income ($59,500) and years of education (14.8 years). It seems counter intuitive that a well-educated and affluent group of families would lead the foreclosure charge. Yet this group of households made up more than 1 in 10 foreclosures. How do affluent families end up in foreclosure?

Mortgages with High Loan-to-Value. The size of the down payment at closing can vary greatly. FHA loans can require as little as 2.5 percent of the purchase price. A review of mortgages in foreclosure found that the median mortgage had a loan-to-value of about 65 percent. Mortgages in foreclosure had a median of 96 percent.

Fucking asshole Gen-X kids - they were supposed to buy that overpriced 3/2, and keep it even when it's real valuation falls to 1/10th their buy price, so I could retire to Asia Minor and live like Caligula by selling the 3 rental gold mines I was going to sell to have my Anatolian empire and vacation castles in Scotland and Estonia! There out to be a law!

It took a lot of effort to deduce this fundamental equation of the universe, but now we can explain why men should date younger women using only the natural physical and mathematical constants of our universe. For such an elegant equation with only natural terms to express the dating age correlations so precisely that no observation has every contradicted the predicted values indicates that a fundamental law of nature must indeed be responsible for these values.

The equation so gracefully combines elements of geometry, physics, and chemistry that the only question remains is in which field shall I receive the Noble Prize for this equation. Perhaps all three?

Gen X are 15% of the population and had 10% of the foreclosures. Get em!

That still doesn't mean they were the cause. The cause was lack of underwriting, you know, the job of the banks. They knew they could get awayMark D says

it was the baby boomers in congress that deregulated the financial industry.

/thread

That is BS. The idea that we divide boomers from others is foolish. The central bankers deregulated the financial system because big finance figured out how to fleece regular people. It started at Basel 2 in 1998 and then with the repeal of Glass-Steagall and the deregulating of the derivative swaps. Phil Gramm led the repeal of Glass-Steagall and was born in 1942, and Wendy Gramm led the deregulation of the derivatives and insurance against the crap CDO's. She was born in 1945.

Gen X are 15% of the population and had 10% of the foreclosures. Get em!

That still doesn't mean they were the cause

varmint was being sarcastic. His point was that clearly Gen X participated less in the bubble and foreclosure mess than their fair share based on the percentage of potential home-owners who belong to Gen X.

Next you're going to tell me that the popping of the bubble was a black swan event lmao

Let me put on my ohshitimsosurprised face. You mean to tell me that house prices don't always go up? That there has to be some connection to reality of wages and prices? Bloody fucking hell,,,that's just bullocks. My realtor says otherwise

Generation X was Most to Blame. The largest percentage of households in foreclosure belonged to those in Generation X—in particular, Gen-Xers who had high average household income ($59,500) and years of education (14.8 years). It seems counter intuitive that a well-educated and affluent group of families would lead the foreclosure charge. Yet this group of households made up more than 1 in 10 foreclosures. How do affluent families end up in foreclosure?

well for one.. many ignored history that home prices do actually go down. certainly heard many times over "RE never goes down".. which it actual did back in early 80s and 90s.

regardless history even in SFBA.... they ignored it thinking they were immune from any downturns. I certainly dont know what the GX were ignorant on how homes like in SoCal went down by 40-50% by 1991-95. It was a deep deep correction. Many others were hell bent on RE as a path to wealth, Its all odd how many ignored recent history.

well for one.. many ignored history that home prices do actually go down. certainly heard many times over "RE never goes down".. which it actual did back in early 80s and 90s.

Also, the housing market was not destablized in the 1990's. People could still get loans and there was not a credit crisis. You are mixing apples and oranges Wong. We did not have wages stagnating and easy money loans en masse. We had that in 2000-2010.

well for one.. many ignored history that home prices do actually go down. certainly heard many times over "RE never goes down".. which it actual did back in early 80s and 90s.

Also, the housing market was not destablized in the 1990's. People could still get loans and there was not a credit crisis. You are mixing apples and oranges Wong. We did not have wages stagnating and easy money loans en masse. We had that in 2000-2010.

In Texas in 1985, my father's house was worth $75k. By 1990 it was worth $50k. It was not until 1998 that the house was again worth $75k.

By 1990, almost every bank and savings and loan in Texas failed.

As much as I disliked GHW Bush, he at least called up his attorney general Dick Thornburgh and told him to find the worst crooks in the S&L scandal and put them in jail. He put almost 1,000 bankers in jail.

How many banker has Holder put in jail? ZERO. Obama has him raiding marijuana clinics and providing guns to Mexican drug gangs instead.

In Texas in 1985, my father's house was worth $75k. By 1990 it was worth $50k. It was not until 1998 that the house was again worth $75k.

By 1990, almost every bank and savings and loan in Texas failed.

Even with the S and L crisis, your house bounced back to the 1985 value. There was never a credit crisis and banks kept lending, except of course, the S and L's.

George HW Bush put bankers in jail. However, the banking community is much more powerful now. They are immune from prosecution now. The reason is, the international financial cabal sanctioned the last housing bubble. It was created at Basel 2 in 1998.

But HW Bush did not put Greenspan in jail, and he was responsible for the S and L crisis because he refused to stop the easy money loans. But those loans were small in comparison to the bubble in the 2000's.

Also, the Texas savings and loan debacle was an oil patch depression. And it happened in my home town of Coalinga California. But it was nothing like what we had in the housing bubble. It was small potatoes.

1993: It's definitely a buyer's market. Some people are saddened by the fact that current prices are 50% of what they were in the 1980's. The housing bust in Southern California is clearly negatively impacting the California economy and the national economy at large. Sellers are desperate to sell (and some people taking extreme measures like putting huge "for sale" signs on their lawns for passing planes to see). Folks who waited out the boom to buy at the bottom are being handsomely rewarded for their patience. Proof-positive of the contrarian investing style -- be greedy when everyone is fearful and fearful when everyone is greedy. The "slump" may be ending.

Also, the Texas savings and loan debacle was an oil patch depression. And it happened in my home town of Coalinga California. But it was nothing like what we had in the housing bubble. It was small potatoes.

The S&L collapse was due to fraud and theft.

Texas based Sunbelt Savings & Loan was known as Gunbelt Savings & Loan as it was revealed how execs spent the institutions money on yatchs, hookers, and cocaine.

Don't forget that John McCain himself successfully put his career on the line to keep Charels Keating out of prison and Bush's son Neil was threatened with jail for his part in the collapse of Silverado Savings & Loan.

Don't forget that the Resolution Trust Corporation was created to track down and confiscate stolen property and monies.

Don't forget that John McCain himself successfully put his career on the line to keep Charels Keating out of prison and Bush's son Neil was threatened with jail for his part in the collapse of Silverado Savings & Loan.

Don't forget that the Resolution Trust Corporation was created to track down and confiscate stolen property and monies.

Today the crooks get to keep thier ill gotten gains.

Yes, Bill Seidman, before he passed away, said the TBTF banks should be put into a resolution trust. It never happened.